PDGM and Beyond
Home Health Billing
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The Patient Driven Groupings Model (PDGM) – known as the most sweeping change in home health reimbursement since October 2000 – continues to live up to the hype surrounding its launch on January 1 of this year. Simply put, PDGM has proven to be a handful for most HHAs. Agencies across the nation are trying to figure out best practices for success under the new payment model.
Here are the Top 5 areas of focus for agencies to avoid significant losses under PDGM:
- Referral Order & Confirmation of the physician that will follow the patient in home health.
- Face–to–Face Acknowledgement that a face–to–face encounter did occur, and that the agency obtained a signed, dated encounter note where the practitioner addressed/treated the patient for the primary reason the patient requires home health.
- History & Physical, including Discharge Information – the H&P and discharge information are needed for multiple reasons, but the most important include:
- Medical necessity documentation to support home health
- Diagnosis coding in the medical record confirmed by a physician
- Status of the patient stay and discharge date (It’s imperative under PDGM to understand whether the patient was an official admission and, if so, the exact discharge date that must be reflected on home health claims.)
- Medicare Eligibility Verification – You must verify that the patient is a traditional Medicare patient and establish if there have been previous home health episodes to determine if the new admission is early or late.
Untimely Signed Orders
Agencies must be diligent about getting signed orders returned so that they can efficiently complete billing. Cash flow is a universal issue under PDGM. Requests for Anticipated Payment (RAPs) are being paid at 20% of the anticipated 30-day payment amount, which gives agencies an even greater incentive to get orders back as quickly as possible. Final claims can now be filed at the end of each 30-day payment period, but the glaring requirement to do so is having all orders back from the physician.
Lack of Interdisciplinary Collaboration on OASIS-D1
The OASIS has a huge impact on the PDGM HIPPS code calculation in the aspect of the Functional Impairment Scoring, which comes from the Activities of Daily Living (ADL) section of the OASIS. M1800-M1860 (except M1845) and M1033 are the items used in the calculation. This section includes the only items from the OASIS that are used in the PDGM scoring, and this is the only chance for agencies to impact the scoring from OASIS as it relates to the increase in reimbursement.
From a medical review standpoint, these OASIS items are the first steppingstone in supporting medical necessity of therapy. It is a well-known fact that therapists are trained to functionally assess patients differently than nurses. It is also a fact that if nursing is ordered, then nurses must complete the comprehensive assessment of the patient. In this case, it is imperative that interdisciplinary collaboration exists between the nurse and the therapist to ensure the OASIS items reflect the functional status of the patient as will be recorded in the therapy documentation and care plan.
Institutional vs. Community Mishaps
Under PDGM there is a significant difference in the case–mix weight for a patient that receives Institutional credit and one that is Community. To receive Institutional credit, the patient must be officially admitted and discharged from an acute care hospital or qualifying post-acute facility where the discharge date is within 14 days prior to the start of the HHA 30-day payment period. The final claim for the 30-day payment period should include the appropriate Occurrence code with the corresponding discharge date from the facility that triggers the review of Institutional status in the case–mix weight calculation. If the Occurrence code is missing from the claim and the facility claim is NOT in the Medicare claims processing system, the agency stands to lose the Institutional increase in case–mix weight, which could be 40% higher than Community.
Lack of Monitoring LUPAs & PEPs
The Low Utilization Payment Adjustment (LUPA) and the Partial Episode Payment (PEP) Adjustment are the two most significant payment adjustments that agencies can receive and sometimes self-induced. LUPA adjustments occur when the LUPA threshold is not met for the given 30-day payment period. While agencies will have LUPAs – and it is NOT advised to ever attempt to avoid them 100% – there is wisdom in monitoring them to ensure that your agency is not allowing them to occur unnecessarily. Some of the thoughts behind this is primarily missed visits. Missed visits that do not get rescheduled in a timely manner could cause a LUPA to occur. Under PDGM, the LUPA thresholds are specific to each of the 432 case-mix groupings and will likely be different from one 30-day payment period to the next. Agencies should monitor each 30-day payment period individually to ensure they fall under the LUPA threshold for each.
PEP adjustments occur as the result of a patient being discharged and readmitted or transferred between agencies during the same 30-day payment period. One of the significant concerns under PDGM is agencies consistently discharging and readmitting patients due to a facility admission in order to receive Institutional credit in the subsequent 30-day period. Agencies should consider asking if a PEP adjustment will result and, if so, whether the benefit of Institutional credit will outweigh the effect of the PEP adjustment.
PDGM is the new reality for HHAs, and it isn’t going anywhere. Like it or not, HHAs must learn to live with this new model and structure their processes so that they can begin to thrive under PDGM.
Healthcare Provider Solutions provides billing services to home care and hospice agencies across the country. HPS can assist agencies in reviewing processes related to PDGM implementation and can assist with billing and collections in form of outsourcing or training of your staff. HPS and eSolutions have been trusted partners for eight years.
Melinda A. Gaboury
CHIEF EXECUTIVE OFFICER
D. Mark Cannon, CPA
CHIEF FINANCIAL OFFICER
Aaron D. Carey
CHIEF OPERATING OFFICER